1st 3 mos Cost of Living Reality Check

Wife & I have been down here going on four months, so thought I'd relate my thoughts on Cost of Living.
Probably of little interest to those that are already here, but for those pondering whether to venture to Lakeside, this might prove worthwhile.
We'd both done a lot of research prior to moving down, so I had taken all the information available on all the boards and come up with a budget. The budget was part of the rationale for moving down, makes the nest egg last just a little bit longer. Our observations are:
* Groceries aren't significantly cheaper, and in some cases, slightly more, but on average about the same as we were paying up north. With that said, vegetables and fruits are more plentiful and are cheaper if you shop at the tianguis.
* Utilities are much cheaper that up north (from Dallas area). So far our electric is averaging about $ 65/mo, gas $ 50/mo, DSL & phone $ 40/mo, water included in rent. and Vonage $ 25/mo. That's versus elect of $ 320/mo, gas $ 50, internet & cable & phone of $ 220/mo, water $ 110/mo. Big savings. Internet much slower, cable tv using slingbox, phone using Vonage
* We're renting, and I figure about half our rent is paid for with the savings from no real estate taxes and insurance, around $ 500/mo.
* Rented a car for the 1st 3 months, then bought one. Nice little '06 Toyota Corolla for ~ $ 7,500, full coverage insurance ~ $ 400, Car gas ~ $ 45/mo
* We're paying 300 pesos per week for our housekeeper twice a week, which is well worth it to us. Gardener is included in the rent.
* Most of the rest that we spend is on entertainment and going out to eat. We go out to eat more than I thought we would, one because it's cheap, two because it's plentiful, and three because it's a good way to get with friends. In part I think it's an offset to groceries somewhat.

I had figured our up north budget at around $ 5,000 per month to pretty much live. Down here I think we're looking at slightly more than half that, and that is including the rent. When we were renting both the house and the car, we figure it was running around $ 3,200 - 3,400, but after buying the car that gets down to $ 2,600 - 2,800. If we eventually buy, the monthly cash flow will drop down significantly.

Based on the research I did before coming down here I had pegged the COL at around $ 2,500. Many of the friends that I met had said that $ 2,500 - 3,000 would enable us to live well down here. After being here for a little over 3 months, I am pleased to report that the numbers are good numbers. If you own a home (and admittedly I cannot speak to home maintenance) you can live very comfortably down here for less than $ 2,000/mo. If you're renting, it can be around that plus rent.

For more details you can see my blog (link above), the October 9th entry.

When one sees statements such as the following about owning a home in the Lake Chapala area: "HERE'S THE KILLER: Repairs and Maintenance of a house. Repairs, Maintenance and Misc: $ 58,221 pesos/year or $ 4,851 USD/year or $ 404. per month" - one would have to think about the viability of actually purchasing a home!

Juan, what a great post!

CG, WOW! Trip Advisor advice?? Where did that come from? I can't IMAGINE spending that much money on maintenance!!! No way! At least not at my house. Maybe if someone lived in a really old house w/old everything? idk

Chapalagringa wrote:Juan, what a great post!

CG, WOW! Trip Advisor advice?? Where did that come from? I can't IMAGINE spending that much money on maintenance!!! No way! At least not at my house. Maybe if someone lived in a really old house w/old everything? idk

That's our situation. Old home, tons of character, gorgeous views, lots of maintenance. Thing is it's been here for a very long time and we kinda trust it.

Actually that is a quote made on this forum by a preeminent poster who happens to claim to know all but lives in the "premier gated community" in the Lake Chapala area. Here is another hint: his house and some possessions are currently up for sale and he plans to move to Southern California! Get it yet?

CheenaGringo wrote:Actually that is a quote made on this forum by a preeminent poster who happens to claim to know all but lives in the "premier gated community" in the Lake Chapala area. Here is another hint: his house and some possessions are currently up for sale and he plans to move to Southern California! Get it yet?

Oh yeah, we get it alright. In our case, due to back and neck problems it really is costing about that much. Albeit in a 40 year old house. A few years back, we could do it ourselves, and it wasn't too bad. We put a few things on iggy, however after 12 years there was some stuff that could no longer be ignored. I must admit this is a special case and would not apply to everyone. The view is killer, so we deal with it.
The good bit is that NOB it would cost us about 10 times as much. The silver lining.

Honestly over the years, and ignoring a lot, or turning a blind eye, it wasn't nearly that bad.

I've been in my admittedly, new house 14 months & don't spend anywhere near that. That sounds high even for an older home unless it was in really bad repair.

Carry Bean wrote:I've been in my admittedly, new house 14 months & don't spend anywhere near that. That sounds high even for an older home unless it was in really bad repair.

Well it had a couple of issues. Nothing too serious, however we tend to be a bit picky. If it could be done with a simple solution, we'll go for at least double, if not triple the fix. Paint is a big deal, and must be done at least every five years even if you go for the best paint possible. New roof, tile replacement, 4 renovated bathrooms, and a renovated kitchen. You do the math. In a new house those things are not an issue. On the other hand, an incredible view and architectural details not found in newer homes makes up for it.
Think of what property taxes cost NOB. That's our excuse. Plus it is a fair sized place, so the painting alone is pricey. Roof tiles, thousands of them.

I really should mention here that newer homes should not require anything like this level of maintenance. Many people have asked us if we had our house custom built, so that's the level of repairs I'm talking about. The kind which make a house look new.

No body is talking about medical expenses regarding their budget. When I first moved here twenty years ago I could see a primary care for about ten dollars a visit a specialist would cost about fifteen. Now it it costs about five times that amount.
People in our age group will use more medical now than before. You can join IMSS if you have no preexisting conditions. If you do qualify and you think that your HMO is the states was bad you will see how bad IMSS is. The other free or almost free is sequir popular. That's for the poorest of the poor Mexican and the for the gringo free loaders or loosers.

CheenaGringo wrote:When one sees statements such as the following about owning a home in the Lake Chapala area: "HERE'S THE KILLER: Repairs and Maintenance of a house. Repairs, Maintenance and Misc: $ 58,221 pesos/year or $ 4,851 USD/year or $ 404. per month" - one would have to think about the viability of actually purchasing a home!

Wrong info, it is 35,488 per year with a 13.0 exchange rate making it $ 2,729. a year. That is for one of the best maintained and kept houses, using the best contractors which are higher priced. Includes painting and roofing, not cheap, but will last 5 to 7 years if done correctly. Our paint job lasted 6 1/2 years. This also included work we chose to do that others would not have done. And you have to figure in pool pump repairs and replacement of sand filter. We also have to maintain our casita. Also, includes all replacement items.

juanrey - I'm not questioning anything, but your electric at $ 65 a month is not the norm here. It's obvious you don't have a pool. Electric in our neighborhood runs from $ 2,200 - $ 5,000 pesos every 2 months or $ 85 US to $ 192 a month depending on lifestyle. The normal bill here is $ 4,000 - $ 5,000 pesos every 2 months. We all have pools.

Your figures for living in the US seem extremely high. $ 5 K a month is $ 60 K a year. We spent far less in Massachusetts with our modest $ 1,200 a month house payment. And I thought it was so much higher cost of living in the Northeast, but apparently not because your electric figures seem very high as do your water bill, phone, internet, cable tv. I dunno.

I think you have figured quite high to live here. This is what it has cost us to live here for 6 months, YTD, INCLUDING Repairs and Maintenance and Miscellaneous. It is $ 185,826 pesos or $ 30,971 per month or $ 2,382. USD a month. If you're renting you can deduct $ 22,098 pesos or $ 3,683 pesos a month or $ 283 USD a month to give a net total of $ 27,288 pesos a month or $ 2,099 a USD a month.

John, if someone is renting they will have to add about $13,000 pesos per month to your overall budget to include monthly rent, not deduct.

John, My CFE average bill over the past 3 billing cycles is 1615 pesos.

CanuckBob wrote:John, if someone is renting they will have to add about $13,000 pesos per month to your overall budget to include monthly rent, not deduct.

I just meant they wouldn't have the Repairs and Maintenance not owning a house. Otherwise you are correct, so it could be more expensive to rent, no?

Jim W wrote:John, My CFE average bill over the past 3 billing cycles is 1615 pesos.

Is that per month or per billing cycle?

Per billing cycle, solar heated pool, two refers, 3 sat receivers DW....etc. 808 pesos per month. It was higher back in 06....till I added a 2nd CFE meter, and balanced distribution.

johninajijic wrote:

CanuckBob wrote:John, if someone is renting they will have to add about $13,000 pesos per month to your overall budget to include monthly rent, not deduct.

I just meant they wouldn't have the Repairs and Maintenance not owning a house. Otherwise you are correct, so it could be more expensive to rent, no?

Well that would depend on what you are doing with the $400K that you would be spending on a nice house. If it is invested properly and earning you 5% - 10% percent somewhere then it may be better to pay the rent with your dividends and hang onto the cash. That is our theory for now at least.........

John:

Before getting indignant about the cost of living expenses, I quoted back on Oct 15, 2011 - they were taken directly from what you had posted at the time. There is no question with the variances in the exchange rate that they don't equate the same way today.